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You are in: Home > 2015. 63rd Edition  > Festival Diary > Bizkaia Welcomes 30% Tax Shelter
Festival Diary » THE INDUSTRY CLUB
Bizkaia Welcomes 30% Tax Shelter
Sunday, September 20th, 2015

As Txintxua Films prepares for Monday’s world premiere of Asier Altuna’s family drama Grandma (Amama), a chronicle of modernization in a Basque rural world, the Basque film industry took a rain-check Saturday at the San Sebastian Festival on its own advances with two key mechanisms for a modern industry: Tax breaks; bank guarantee mechanisms.

Both have progressed, as has the Basque industry at large, as it positions itself as a film hub with one eye on strengthening contacts with Europe,and the other on Latin America. In one move, on July 15, the European Commission greenlit a 30% tax shelter for film investment in Bizkaia, best known for capital Bilbao.

The incentive rates as one of Spain’s highest deductions. Usable by Bizkaiabased tax-payers on any Spanish film – whether it shoots in Bizkaia or not - the 30% tax break can be applied on up to 50% of production costs and 40% of P & A. Channeled via an Agrupación de Interés Económico (AIE), it is limited at 45% of investors’ tax payment.

In a second initiative, Elkargi, a Basque bank loan guarantee scheme – used by Txintua Films to allow it to discount a pre-buy from Basque pubcaster ETB, producer Marian Fernández said Saturday - has joined forces with the Basque Government to offer Basque companies consultancy on access to private-sector investment. That will occur without detriment to Basque Government aid to film/TV sector, said Joxean Munoz Otaegi, its deputy councilor for Culture, Youth and Sports.

Currently, Gipuzkoa and Alava must still adapt the 30% incentive to their own tax laws. That opens the door to some tweak such as territoriality – AIE-aided films should partly shoot in the provinces - or even tax rebates for international shoots, said Miren Itziar Agirre Berriotxoa, Basque Tax J Administration director.

They shouldn’t hang around. To date just two films – Luis Marias’ “Fuego,” produced by Eduardo Carneros (“Timecrimes”) and Koldo Serra’s “Gernika” - have used the 30% incentive. Yet, now EC approved, the shelter has had, per Carneros, “an absolutely positive impact. The Basque Country has become a highly competitive production hub and can generate a large, solvent and, above all, sustained industry”.

JOHN HOPEWELL

 

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